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Newcastle Building Society launches top cash Lifetime ISA
Newcastle Building Society has launched a market-leading cash Lifetime ISA – making it only the third provider to offer this type of savings account, which offers a 25% bonus towards buying your first home or retirement.
In addition to the 25% Government bonus, the account pays 1.1% AER variable interest, beating the offerings from Skipton and Nottingham building societies, which both pay 1%.
You can open a Newcastle Lifetime ISA (LISA) online, but at the moment it's not accepting LISA transfers in, so you won't be able to benefit from the increased rate if you're looking to switch providers.
Newcastle Building Society has told us it plans to offer transfers in the future, but can't say when.
Lifetime ISAs were launched in 2017, but aside from the current three cash versions the only other LISAs currently available are stocks and shares LISAs which come with added risk.
See our Lifetime ISAs guide for full info on how they work and who they're best for.
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What's a Lifetime ISA?
Here are the Lifetime ISA need-to-knows:
- A LISA can be opened by anyone aged 18-39.
- You can save up to £4,000 a year.
- You get a 25% state bonus paid on top (up to a maximum of £33,000).
- You'll pay a penalty if you withdraw the cash for anything other than your first home or before you turn 60.
For first-time buyers, a cash LISA can be used towards the purchase of a property worth up to £450,000.
If you're using it to save for retirement, you can save in it until the day before your 50th birthday, and withdraw the cash and bonus when you turn 60.
For more details, see our full Lifetime ISA guide.
What are the features of this new LISA?
Newcastle's LISA is available to open online, and it can be managed online, by phone or by post.
Other account features include:
- It can be opened with £1.
- Interest is paid annually, on the anniversary of account opening.
- You can't transfer into your LISA from any existing ISAs, including Lifetime or Help to Buy ISAs. Newcastle has told us it plans to add this functionality, but hasn't given a timescale for this.
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